Despite SA being one of the world's fastest growing mobile phone markets - and the ever-decreasing prices of smartphones putting the Internet into ever more inhabitants' hands - SA's international broadband ranking is declining daily.
This is according to Dr Marten Scheffer, GM of network engineering at Neotel, who says the current state of affairs is a clear indication that mobile is not solving SA's broadband deficit.
Scheffer says fibre-to-the-home (FTTH) - which has seen an increased level of activity locally this year - could go a long way to improving SA's broadband outlook, if correctly understood and approached.
He says Neotel has invested a great deal of research and development in the area, and has 800km of fibre to the curb installed throughout Gauteng, with in the region of 6 000 buildings already connected.
Paving the way
As it stands, the company is running FTTH purely on a trial basis, but Scheffer says it hopes to be a pioneer when the time is ripe. "Someone has to move first and we hope we will be one of the first movers."
He notes that, unlike in Europe and the US, SA does not have as many alternatives for the expanse of broadband to play with and as such can be more optimistic about the penetration rate that will accompany FTTH rollout. "It is easy to over-invest in fibre. We have seen cable and fibre operators in Europe with penetration as low as 20%."
That said, notes Scheffer, FTTH is a risky commercial equation in any market.
Neotel has carried out proof-of-concept trials in the Johannesburg CBD and is part of the Maboneng Precinct's FTTH deployment. "We have also deployed FTTH in selected high-end suburbs like Houghton - as well as in some of the lower-end areas, where we have combined the technology with free WiFi."
He says the company is busy in this regard with a project in Tshwane, but details are still under wraps at this stage.
Chicken and egg
"Neotel has come to understand the costs of deployment. We have gained a lot of experience and determined the elements required for a successful FTTH venture. We are still trying to solve the element of content - the availability of good quality video and movie content - which is still very limited in SA."
He notes that, although services like Netflix and Hulu have expressed interest, they have not quite taken the step to enter SA as yet. "Even Apple TV offers only a very limited bouquet."
Scheffer says SA is up against a chicken and egg scenario: "We don't have the fixed broadband to allow content to be viewed satisfactorily."
Other than the content, says Scheffer, there is the actual cost of fibre deployment. "Metro councils and the rights of access to deploy still play a big role. The process itself is quite expensive and metros don't readily make their facilities available in residential areas so you have to plant new series of poles."
MTN, Vodacom and Telkom Mobile all recently expressed interest and indicated respective action being taken in the realm of FTTH, with Vodacom remaining more tight-lipped than its counterparts, with a deal between itself and Neotel set to be wrapped up in March next year, subject to the requisite regulatory red tape being cut.
Scheffer says, while timelines are difficult to carve into stone, Neotel wants to turn its FTTH into a commercial offering "soon".
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